US Propane Exports -- One Of The Top US Energy Stories Of The Decade -- July 3, 2016

Flashback: I don't know if folks recall, but during the winter of 2013 - 2014, the US was experiencing a severe propane shortage.

Fast forward to summer of 2016: US propane exports are expected -- by the end of this year -- to exceed those of Qatar, Saudi Arabia, Algeria and Nigeria combined.

Back on  April 29, 2016, RBN Energy provided an incredible update of the US propane story -- this is a huge turnaround story in less than three years -- and very few Americans are even aware of it. For me, it has not sunk in, and I follow energy pretty closely (at least superficially). Look at some of the data points:

• US domestic production of NGLs (like propane and butane is soaring
• US liquified propane gas (LPG) exports in the past three years have rocketed to the top
• US exports of LPG now surpasses exports by the old Big Three: UAE, Qatar ("cutter"), and Algeria
• the rise in LPG exports may be ending
• exports from the Gulf coast may be in for a decline
• more propane and butane from the Marcellus and Utica will be re-routed to Marcus Hook, PA
• demand for new propane dehydrogenation plans and flexible steam crackers will be climbing

And this has only just begun. Remember, this turnaround story occurred before the expansion of the Panama Canal. It was just late last month that the first propane-laden "New Panamax" vessel that transited the canal:

RBN Energy: a propane-laden VLGC inaugurates the expanded Panama Canal.

After the $5 billion-plus expansion of the Panama Canal is dedicated this Sunday, June 26, the first “New Panamax” vessel scheduled to pass through the canal’s new, longer, wider locks will be the Lycaste Peace, a Very Large Gas Carrier (VLGC) that is transporting propane from Enterprise Products Partners’ Houston Ship Channel export terminal to Tokyo Bay in Japan.

What remains to be seen, though, is how many other supersized vessels carrying propane, liquefied natural gas (LNG) or other hydrocarbons will follow, and how soon. Today, we mark the formal opening of the newly enlarged Atlantic-Pacific short-cut with a look both at the game-changing potential of the expanded canal and the realities of today’s energy and shipping markets.

For more on how US ports are prepared for the Panama Canal expansion, see this post.